Verve Payment Cards in Nigeria, Africa’s largest consumer market and its pioneer country of issuance have now surpassed 70 million issued payment cards to date. This development comes 15 months after the scheme announced it had issued 50 million payment cards in Nigeria in July last year, translating to +40% growth in issuance volumes YoY.

Over the last few years, Verve has grown to become the payment card of choice across various tiers of banking service and particularly within the burgeoning fintech/neobank space in Nigeria, on the back of significant strategic partnerships across commercial and microfinance banking spheres, as well as fintechs, OFIs and public sector due to sustained innovation and demonstrated understanding of the requirements of its local markets.

As Africa’s premier and leading domestic payment cards scheme, Verve remains focused on addressing peculiar market challenges in Africa by providing secure and cost-effective payment options for individuals and businesses to exchange value, offering both virtual and physical cards that facilitate payment for an increasing number of international services in local currency.

In the last 3 years, Verve has made significant progress in this regard, having achieved merchant acceptance with platforms such as Google, Spotify, Netflix, Showmax, Amazon Prime, Facebook, Microsoft, Uber, and Flywire , to mention a few, underscoring a strong resolve to continue to drive relevant partnerships that provide its users in Africa convenient opportunities to access global services in local denominations.

Outside Nigeria, Verve cardholders are provided with the benefit of using the Verve card in Nigeria and over 21 other African countries, underscoring the company’s resolve to ensure the seamlessness of transactions across the continent, particularly for the critical mass of consumer demographics, whilst driving value and efficiency for African financial institutions.

Particularly noteworthy, are rapidly expanding issuing and acceptance partnerships across East Africa, including major financial institutions including the 2 largest financial institutions KCB Group and more recently Equity Bank, in addition to a growing network of savings and credit societies (SACCOs) across Kenya and Uganda.

Speaking on this latest business milestone Chief Executive Officer (CEO) for Verve International, Vincent Ogbunude, asserted that Verve continues to provide innovative ways to make transactions and payment more secure and convenient for customers, not only in Nigeria across Africa and beyond, whilst providing unparalleled business value for business partners from both issuing and acquiring perspectives.

In his words,

“At Verve International, we continue to consolidate our delivery of global-standard payment solutions howbeit essentially tailored to economic and operational realities of the markets where we play across Africa, whilst leveraging value-adding partnerships that ensure we scale our impact and turbo-charge financial inclusion on the African continent. We are greatly delighted again at this point to celebrate another phenomenal milestone, having added 20 million new payment cards to our base in Nigeria, for which we are extremely appreciative of our issuing partners as well as our loyal cardholders…”

It would be recalled that Verve, Africa’s largest domestic payments card and token brand recently launched the fifth edition of its Goodlife National Consumer Promo, a reward program designed to engage and reward its millions of cardholders.

The promo, which runs from August 15 to December 31, 2024, offers instant discounts and rewards for Verve cardholders at selected merchants and retail outlets across Nigeria, including NNPC Retail Limited, Addide, The Place, Sweet Sensation and Chowdeck, among others.

Verve international, a subsidiary of the Interswitch Group, Africa’s leading integrated digital payments and commerce enabler is the first EMV-certified pan-African domestic payment card scheme (a subsidiary of the Interswitch Group), issuing cards and payment solutions to individuals, issuers, and organizations; and remains committed to pushing the boundaries in terms of customer experience and payment possibilities.

Cardholders have come to regard Verve as a safe, convenient and reliable payment solution for everything payment. Verve cards can be used across a wide range of payment channels like Point of Sale (POS) terminals, Automated Teller Machines (ATMs), Agency banking channel, Web / eCommerce, and Mobile Apps.

The partnership will facilitate the provision of diaspora cash remittance services to rural recipients in Kenya through the Savings and Credit Cooperative Society (SACCOs).

Tagged the Affordable Remittances and Enhanced Financial Inclusion Programme, the initiative will enable unbanked rural remittance receivers to access formal banking services through a basic and transparent bank account and see Interswitch and its partners collaboratively train and build capacity for over 1,350 SACCO members.

Credit Bank projects that during the initial phase of the programme, it will reach at least 1,200 Kenyans living in the diaspora and facilitate at least 1,500 rural recipients back home to open a bank account for the first time.

Thus far, the initiative has onboarded three SACCOs that will be engaged in the next 16 months, with projections to onboard seven more over the next 36 months.

The SACCOs will have their staff appointed as sub-agents in the rural Kenyan areas which are currently underserved by formal remittance providers.

Speaking on the partnership, Mitchell Elegbe, Founder and General Managing Director of Interswitch Group, stated that the collaboration is indeed a significant stride towards bridging the financial divide, empowering more individuals and businesses in Kenya with access to modern payment solutions, and creating a more inclusive financial ecosystem for all.

“This partnership with Credit Bank of Kenya and IFAD marks an important step as we continue to expand our reach and provide innovative solutions for our customers worldwide. As we all know, remittance plays a crucial role in the lives of many people, and we are committed to making it simpler, faster, and more affordable” he added.

According to Romana Rajput, the Country General Manager of Interswitch Kenya,

“SACCOs form an important part of our financial services in Kenya where we come together to save money and improve the quality of our lives through lower interest rates loans to acquire important purchases like land, homes, educate our children, improve our businesses and much more. Working with SACCOs and their members will make transfers quicker and more convenient for beneficiaries.”

Diaspora remittances have grown in recent years to become Kenya’s biggest source of foreign exchange, largely driven by a growing number of Kenyan immigrants to Western economies such as the US, UK and Canada, and also a growing Kenyan migrant labour force in the Middle East.

“Diaspora remittances have an integral role in emerging economies like Kenya and with an estimated $4 billion sent back home each year, they present a crucial source for foreign exchange and capital flows into the Country, said Credit Bank CEO, Betty Korir, adding that “Initiatives like this will encourage Kenyans across the world to send money home while ensuring the largest possible portion of this money gets to rural recipients. The partnership will cut down the number of intermediaries to facilitate transfers directly to the last mile. We believe that we can take advantage of our wide SACCO networks within our rural communities to make remittances more accessible at the least cost.”

This collaboration which will deepen financial inclusion efforts in Kenya, highlights Interswitch’s vision of a continent where payments are a seamless part of everyday life as the tech giant continues to leverage strategic partnerships of this nature to drive convenient value-exchange across borders.

Those individuals often turn to alternatives, such as Micro-Finance Institutions (MFIs) and Savings and Credit Cooperative Societies (SACCOs).

In fact, MFIs and SACCOs are very popular across the developing world, where Africa and Asia alone account for almost 90% of the total number of credit unions worldwide. As of 2019, there were around 39,600 credit unions in Africa and around 33,600 in Asia.

Both SACCOs and MFIs provide a compelling alternative to other mainstream financial service providers.

Customers of these groups gain benefits they can’t access at traditional banks – especially in regard to lending. 

Many people do not meet the loan requirements of a bank, such as having an ‘on file’ credit history or the right personal documentation, and loan conditions can be expensive and inflexible. On the other hand, they don’t want to deal with moneylenders and unregulated loan sharks. SACCOs and MFIs are the trusted option for such customers.

SACCOs and MFIs are often embedded within their communities, and in the case of a SACCO, they are a non-profit member-owned institution where the individuals receiving the service are often also shareholders.

They can provide micro-loans and operate on a much more personal level to offer flexible terms. These groups do not have the same Know Your Customer (KYC) requirements as traditional banks and they often serve customers from the informal sector who do not fit the profile required by financial services incumbents.

SACCOs are not only small rural operations, but some have also reached massive scale and popularity. For example, the Kenyan based Police SACCO currently has over 52,000 members. These organisations have aided many small businesses and entrepreneurs in informal economies to get started through funding options.

The digitisation gap 

However, these organisations risk losing ground and customers. Aggressive digitisation by banks, telco operators and fintech start-ups is lowering the barriers to financial services. It’s not (yet) a wholesale shift, as many people still find their options very limited.

However, customers can now enjoy more access through the conveniences of digital services, such as remote mobile banking and lower fees stemming from digitised processes. And MFIs and SACCOs, which operate on thinner margins, are starting to feel the pinch.

The slower adoption of digital services by these groups may have a long-term impact on their popularity.

Many members that previously used such groups for most of their financial needs, are starting to move to other providers for convenient day-to-day transactions such as transfers and payments, and only use MFIs or SACCOs for specific requirements such as lending.

Efficiency and access lie at the heart of the problem, as most MFIs and SACCOs groups still rely heavily on paper-based processes, costing them money and limiting their reach with customers. It also amplifies their risks: with limited liquidity, defaulting customers can quickly make it hard to maintain operations. Additionally, complying with regulations is much more challenging.

This, combined with a generally riskier customer base, can put a lot of pressure on their financial resources. And since many of their potential customers are in rural areas, it’s expensive to enrol new ones.

Imagine what a SACCO or MFI agent can achieve if they could do all of their customer onboarding on the road with a tablet device?

Helping with SaaS 

Previously, traditional financial institutions could not affordably and effectively serve those outlying customers. Yet now, SACCOs and MFIs are struggling to digitise in the ways banks are.

Digitisation can be very expensive, especially in financial services. As SACCOs and MFIs often operate on a small scale, this limits them from making such substantial initial investments in technology. And today they are having to compete with digitising banks, telcos and rising fintech stars threatening to take many of their customers.

While many SACCOs and MFIs don’t have the resources to implement these digital solutions by themselves, there is an alternative.

The majority of these groups favour a revenue-sharing model with an appropriate banking technology platform, using the ‘as a Service’ approach to keep their initial investment costs down.

Rather than buy everything upfront, SACCOs and MFIs can subscribe to technology services – Software as a Service (SaaS) – to gain access to digital platforms. They can then use these solutions to design and deploy loan and savings products that work for their customers, such as flexible micro-loans or group savings accounts. They can also use the same platform for digital onboarding and mobile apps.

The benefit of accessing SaaS is not only from a cost perspective, but also from a resourcing one. Tapping into shared technology platforms eliminates the need for these groups to ramp up their technical expertise and investment in IT infrastructure, which promotes cost savings, but more importantly allows them to focus on the more important aspects of the business.

SaaS platforms give SACCOs and MFIs a way to digitise without taking on enormous costs. While many experts wonder how financial services will reach an estimated 1.4 billion unbanked people across the globe, SACCOs and MFIs are already leading the way. And they can continue that journey and reach more of the unbanked if they can digitise.

If SACCOs and MFIs can leverage shared banking platforms through a subscription-based pricing or revenue sharing model, they can again take the centre stage in providing financial services to places where other financial institutions cannot.